MW Trump tells Warsh 'to be totally independent' as Fed chair. 'Don't look at me,' president says.
By Victor Reklaitis
Trump and new Federal Reserve Chair Kevin Warsh appear together at swearing-in ceremony at White House
U.S. President Donald Trump shakes hands with Kevin Warsh in the East Room of the White House as they arrive at Warsh's swearing-in ceremony to be the new chair of the Federal Reserve.
President Donald Trump on Friday appeared to give some breathing room again to new Federal Reserve Chair Kevin Warsh, as the two appeared together at the White House for his swearing-in ceremony.
"I want him to be totally independent," Trump said during the event. "I want him to be independent and just do a great job. Don't look at me. Don't look at anybody. Just do your own thing and do a great job."
Trump's comment was similar to a remark that he made on Tuesday, when the president said he'll let Warsh "do what he wants to do" with interest rates.
Trump's stance this week is a shift, given he had been putting unprecedented pressure on the U.S. central bank, especially Warsh's predecessor, Jerome Powell, for more than a year because it hasn't been cutting rates by as much as he wanted. The change looks like an acknowledgment that Warsh will be just one of 12 voters on the Fed's rate-setting committee, as well as an acknowledgment of growing support within the committee for a possible rate hike, rather than a cut, due to higher fuel prices because of the ongoing Iran war.
Economists have said that Warsh could be in for a rough start at his new job at an institution that has mostly emphasized its independence from politics. There has been considerable anticipation around whether he can chart a policy course that differs from the president's wishes ahead of crucial midterm elections in November.
See: 5 tests Kevin Warsh will face as Fed chair
Warsh is the first Fed chair in nearly 40 years to be sworn in at the White House; the location has added to concerns about the possible erosion of the central bank's independence. Democrats are skeptical that Warsh can act independently from Trump, with Sen. Elizabeth Warren, a Democrat from Massachusetts, calling him a "sock puppet" for the president.
Warsh, for his part, sounded enthusiastic about holding the swearing-in ceremony at the White House, telling Trump that it was "such an honor" to have the event in the building's East Room. "I couldn't ask for a more beautiful setting or more gracious welcome," the new Fed chair said in his remarks.
The new Fed boss also reiterated his plan to bring reforms to the institution. "I will lead a reform-oriented Federal Reserve, learning from past successes and mistakes both, escaping static frameworks and models, and upholding clear standards of integrity and performance," he said.
In addition, Warsh talked about improving living standards for all Americans. "While I'm not naive about the challenges we face, I believe, Mr. President, these years can bring unmatched prosperity that will raise living standards for Americans from all walks of life, and the Fed has something to do with it," he said.
Skepticism over Trump changing his tune
Investors and other Fed watchers should take Trump's latest remarks about the Fed with a grain of salt, according to Aaron Klein, a senior fellow in economic studies at the Brookings Institution, a Washington think tank.
"I wouldn't read too much into a few sentences uttered at a festive swearing-in," said Klein, who previously worked for the Treasury Department during the Obama administration and for Senate Democrats. The Trump administration "has waged war against the independence of all financial regulators," such as with its executive order this week "requiring the Fed to work toward curbing immigrants' access to bank accounts," Klein told MarketWatch.
"Trump's opinion on the independence of the Fed changes more than the weather," Klein also said. The Brookings expert said the president had wished Powell well "at the start. We know how that ended."
U.S. stocks SPX DJIA were trading higher Friday, as Warsh scored a warmer Wall Street welcome as Fed chair than the recent predecessors who saw declines on their first days.
Trump announced in January that he had picked Warsh - a former Fed governor turned Fed critic - to take over for Powell, whom Trump nominated during his first presidential term. Powell said last month that he plans to remain on the Fed's board of governors until he's sure that the Trump administration has completely ended its probe into cost overruns for renovations to the central bank's headquarters. That investigation has been criticized by Republicans and Democrats as another way for Trump and his allies to put pressure on the Fed.
Warsh served as a Fed governor from 2006 to 2011. After leaving the central bank in 2011, Warsh, among other things, served as a lecturer at Stanford University's business school and as a visiting fellow at the university's Hoover Institution, a conservative think tank. He was also a partner in billionaire investor Stanley Druckenmiller's investment firm and was on the board of directors for shipping company UPS $(UPS)$ and Korean e-commerce company Coupang $(CPNG)$. Like Powell, Warsh has a law degree, while other recent Fed chiefs - Janet Yellen, Ben Bernanke and Alan Greenspan - had earned doctorates in economics.
Warsh, the wealthiest Fed chair ever, is married to billionaire Estée Lauder $(EL)$ heiress Jane Lauder. Estée Lauder shares were soaring Friday, with the jump attributed to news that the beauty company and a Spanish rival, Puig Brands (ES:PUIG), had ended talks about a possible merger.
Greg Robb contributed.
-Victor Reklaitis
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May 22, 2026 13:11 ET (17:11 GMT)
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